# 104.1 Lesson - LimitedSupply

**Screen:** LimitedSupply

**Headline:** Special Characteristic

**Reward:** 2

**Text:** Governments can print fiat money in unlimited quantities.

By way of contrast, the supply of Bitcoin is fixed — and can never exceed 21 million coins.

A continually increasing supply of fiat money creates inflation. This means that the money you hold today is less valuable in the future.

One simple example: A loaf of bread that cost about 8 cents in 1920. In the year 1990 one loaf cost about $1.00, and today the price is closer to $2.50 !

The limited supply of bitcoin has the opposite effect, one of deflation.

This means that the bitcoin you hold today is designed to be more valuable in the future — because it is scarce.

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## QUIZ

**Question:** Is the supply of bitcoin limited forever?

**Answer:** Yes. There can never be more than 21 million bitcoin created.

**Feedback:** Correct. By limiting the amount that can be created, Bitcoin is designed to increase in value over time.

**Correct:** true

**Answer:** No. The government can create more bitcoin at any time.

**Feedback:** Wrong answer. The government has no control over Bitcoin.

**Correct:** false

**Answer:** No, the bitcoin software can be changed to allow more bitcoins to be created.

**Feedback:** Incorrect. One of the key attributes of bitcoin is that the supply is limited forever.

**Correct:** false

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